Interim Budget 2024: Report Indicates No Alterations to Income Tax Rebate

The upcoming Interim Budget for 2024, set to be revealed on February 1, will reportedly maintain the existing tax rebate under the New Tax Regime, according to a statement from a senior official in the finance ministry. Previous speculations about a potential increase in the personal income tax rebate from the current Rs. 7 lakh to Rs 7.5 lakh for those opting for the New Tax Regime are now refuted.

The official stated that there is no current proposal for any changes. In the previous year, Finance Minister Nirmala Sitharaman increased the income-tax rebate threshold from Rs 5 lakh to Rs 7 lakh for those choosing the new direct tax regime.

Additionally, the basic exemption limit was raised from Rs 2.5 lakh to Rs 3 lakh. A deduction of Rs 15,000 for a family pension was introduced. In Budget 2023, a standard deduction clause was included for salaried individuals, pensioners, and family pensioners under the new tax regime.

Under the old tax regime, salaried employees and pensioners currently receive a standard deduction of Rs 50,000. The Centre is anticipated to announce an exemption from tax collected at source (TCS) on overseas credit and debit card spending by individuals, up to Rs 7 lakh per financial year, in the interim budget, according to another source.

The New Tax Regime, featuring revised tax slabs and reduced tax rates, applies to all taxpayers, including individuals, Hindu Undivided Families (HUFs), and Associations of Persons (AOPs). In Budget 2023, the income tax slabs were simplified to six from seven to enhance the clarity of personal income tax rules.

Individuals opting for the New Tax Regime cannot avail of various exemptions and deductions, such as HRA, LTA, 80C, 80D, and more, which are exclusively available under the Old Tax Regime.

Also Read: Navigating Income Tax Returns 2024: Transitioning Between New and Traditional Tax Regimes